Hello new to the site, seeking some advice/opinions.

[target2019]

There are two areas we could really cut back our spending. We eat out a couple of times per week, plus I usually buy lunch instead of packing at work. This all adds up significantly throughout the month. The other area is vacations. We like to travel. We don't travel extravagantly, but we like to go to a lot of places. I would definitely be willing to cut back on the restaurant budget... But not travel. To me, this is a necessary expense.

Start there, then. Get a win under your belt, and it will inspire you to other changes.

If we ate out twice a week, it would cost $80. Cutting back would save $40. If I bought lunch, it would cost $50. Taking leftovers would save $50. Then I could direct an additional $75-100 each week to our investment account of choice.

 

[swakyaby]

In fairness, this is not an excessive amount of debt for a doctor. DS dated a doc student who already had $300k, and she was not done. And, it sounds like his employer and the National Guard will cover it in 6 years.



So, put aside the student debt, they have $565K in investments, and a $200k mortgage. Not bad for late 30's.



And, as far as vacations, the guy worked 100hr weeks while in residency. A few vacations does not seem unreasonable, as long as they don't over reach in this department, they should be fine.



Can they retire in their 40's? Not likely. But by 55-60, very probably.



Just my opinion.

I agree with this assessment, and I am a newly retired physician. I entered private practice at the same age as the OP with high educational debt, and a non-physician working spouse. You have a reasonable plan, have examined your expenses, but because of so many moving parts at this early stage of your career, you’ve wondered if early retirement is a possibility for you and DW. And the answer is probably, but it’s still too early to tell. For me, every time I joined a group practice and thought I would be with them until I retired, some external major event took place and I was forced to change practices and relocate (and completely uproot my spouse’s employment) and start over, about 3 times. It was only when I reached my early 50’s that I could see that our savings and rate of wealth accumulation and lack of any debt put us on track for early retirement at age 56. It did not require difficult sacrifices. We were able to enjoy a very comfortable lifestyle that would incrementally grow as our debt disappeared, our savings increased, and our incomes grew. But I made sure our savings always outpaced our lifestyle creep. I laughed at Mdlerth’s comment, “In 20 years, he’ll be so FI he can’t stand it,” because it is true in my case.

You actually sound like you’re doing fine without a financial planner because you have a good plan for current and future expenses. It is difficult to say at this point how much you need to have saved for retirement because the common rules of thumb given for the average person (80% of pre-retirement income) are not useful for those who earn a high income well above their actual expenses. It is what you actually spend year to year that is more useful. When I reached 50, I tracked my expenses for the year and again at age 55, and realized we had more than enough for a withdrawal rate of 3%-4% of invested assets. Even if your DW had less than 100% pension due to retiring early, you will know by tracking your spending prior to retiring that you will have enough.

I think your future prospects look very good.

 

[socca]

It was only when I reached my early 50’s that I could see that our savings and rate of wealth accumulation and lack of any debt put us on track for early retirement at age 56.

The OP seems to be concerned about his family's balance sheet (large debt), while his family's profit and loss statement is probably looking very good. If he puts his free cash flow to good use (reducing/eliminating debt and long-term investing) he may be well on his way to FI by around age 60 (luck as well as skill also enters the picture, unfortunately ).

My advice to the OP is to learn enough about small business accounting to conceptualize his family as a business. I actually run my personal finances as a business, including using small business bookkeeping software - QuickBooks - but this approach definitely isn't for everyone.

Good luck!

 

[Bir48die]

You are lucky because you can affect or catch up so much faster due to your income and career. It looks bleak early but you can knock this out fast and get on the plus side quickly. Put your head down and pay down your loans. Then you can get on the plus side and start doing what we all did in our mid to late 30's which is socking away for retirement

 

[dirtbiker]

Wow! Thanks for all the replies everyone! If I don't reply to every post, it's not because I don't appreciate it or find it useful, it's just that there was more of a response here than I had expected. I'm at work right now, so I'll reply to as time permits between patients. It's a rainy day and I've had a few cancellations already, so I should have time to reply.

 

[dirtbiker]

If early retirement is what you want it may require sacrifices now. Your income is stellar in the real world but your debt is staggering. Although your peers may be living it up you have the advantage of the loan repayment which is an amazing benefit which gets you closer to your personal goals faster. I have a physician friend with no dream of retiring and honestly many physicians work til really late in life 70-80yrsold. 330k annual income -59.5 savings rate some of which is company contributions. 120k in lifestyle. That still leaves 150k for taxes and other. Reevaluate your budget and make sure your money is working for you efficiently. Even if you are paying 100k in taxes that still 50k that can go towards more savings, debt repayment etc to help towards your goals. In 4 years you could have a paid off house and her student loans paid off easily. Sit down talk it out with your wife and develop a game plan. Blessings on your journey.

A TON of physicians love what they do and work until they no longer physically can. Although I love my job, that's not my goal. I also think a lot of doctors don't plan for retirement well enough and end up working out of necessity, unfortunately. And I'm trying not to be that guy! I actually have an uncle who's a physician in his mid-60s who confessed to me when he turned 60 that he'll have to keep working forever. He's self-employed and had no savings at 60!

 

[dirtbiker]

First and foremost.... get a handle on how much you are spending... from your OP it sounds like it will be your combined take-home pay less the $12k annual savings to the brokerage account. Not sure how much that is but it sounds like it would be quite a lot.

I highly recommend that you get a copy of Quicken Deluxe or higher and spend some quality time with the Quicken Lifetime Planner. It is a fairly intuitive, easy-to-use retirement planner.

How soon will the student loans be paid off with payments of $75k a year?

I'll look into the Quicken Deluxe program.

As far as how much I have for take-home pay, I pay more for taxes than I should for $330k income because the $75k that gets paid toward student loans I'm responsible for taxes for just like regular income, and the amount that can be deducted for taxes is abysmally small. I basically pay nearly an additional $3000 per month in taxes for the student loan reimbursement on income I never see (but that goes to a good place, obviously).

Between the $75k student loan reimbursement and the $24k that I pay toward it, I plan to have it paid off in 6 years.

 

[dirtbiker]

HONK! HONK! HONK! (That is the sound of the cognitive dissonance alarm horn.)

Hahaha. I don't know if it's cognitive dissonance, as much as it is us not having made up our mind where our priorities are.

To be quite frank, I'm unwilling to live by a shoestring budget in order to retire early. I don't want to spend my entire working life looking toward the future and give up enjoying the present. However, I do realize that we could cut our spending down a bit, and we are willing to make some changes to tuck away more toward savings. It's just that we don't know exactly where that line is.

Basically what I'm saying is that we definitely could, and will, cut back our spending... But probably not to the point that many (most?) would consider ideal.

 

[dirtbiker]

dirtbiker, what do you ride?

My favorite reply thus far!

My every day ride is a WR250R, which serves as my dirt bike, my commuter bike, and my long haul road trip bike. There are compromises for each of those purposes, but it's a great all-arounder, cheap to maintain, and smile-producing!

My older two boys (14 and 16) have a KLX140 and a CRF230. My 14 year old is ready to move up his brother's 230, and my oldest is ready to move up to a 250, probably this year.

And since this is a financial forum, all of the bikes are bought used, and I do all my wrenching on my own to keep costs down.

 

[dirtbiker]

You obviously have worked hard to get where you're at, and you have a good handle on what you need to do in the near future. Unfortunately, you're in the same position as so many health care professionals--owing too much on student loans. So many physicians put maintaining their lifestyle ahead of getting their student loans paid, and take into their 50's to be working 100% for themselves. And we see doctors working into their 70's more often than retiring at age 55.

My wife is retired from managing large hospital laboratories, and she has worked with many physicians of all specialties. The norm for physicians is that they quickly move up to owning numerous expensive cars, houses that are larger and much more expensive than they need, having too many children, and sending their kids to very expensive private schools and colleges--while self employed physicians have to 100% fund their retirement.

Unfortunately, governments are increasingly telling doctors how to run their businesses and there are forces working against doctors that are beyond their control. Unless there are changes in healthcare, you will spend more time trying to manage your practice and fighting with insurance companies and Medicare/Medicaid on patient treatments and what they'll pay for. Big hospitals are also buying out hundreds of doctors' practices making nurses and office personnel their employees--and hiring the doctors as subcontractors.

I understand how you cherish your vacations, but not every trip needs to be to Europe or some extravagant location--since you're paying for 6 family members at a time. And I understand how you want to maintain your standard of living at or better than you're at right now.

With 4 children to raise spread out over 16 years, retirement at age 55 is going to be very, very difficult without big changes in spending. You should work very hard to resist driving luxury (or expensive) cars and you should plan on keeping vehicles 10 years. You should stay in your current home at least until the student loans are completely paid. Your kids should stay in public schools if at all possible, and you've addressed their higher education is fortunately covered. They should know that graduate school is on them. They might have to even commute to school and live at home. The decision is whether you're willing to follow such a plan of action or whether you'll be working past normal retirement age.

I'm a 100% employed physician. Independent self-employed physicians are getting rarer and rarer nowadays.

We're in a pretty modest home. Not tiny, but not huge for the size of our family. It needed some work when we moved in, and I've done quit a bit of work on it since buying, all myself, to increase the home value. We're definitely planning to stay in the house until our student loans are paid off... maybe even until the mortgage is paid off too, depending upon where I focus additional income. Paying off the mortgage would make me feel great about not having one... But my investment interest rates are much higher than my mortgage rate...

Too many kids? Probably. We're definitely done now with four. And we do plan to keep them in public schools, and as addressed earlier, public higher education too. And we have told them that grad school is on them if they decide to go that route.

 

[dirtbiker]

I don't mean to be flip, but did you discuss this idea of retiring early before racking up half a million plus dollars in student loans.

Also this 90K college pension is hardly a done deal your DW is just 38 and not tenured...Don't go near a financial planner until you can really figure out what you want for the next 20 years. I don't see anything for an emergency fund do you have one? Do you have life insurance to cover that student loan or would that go away if something happens to you?

I have to agree with Old Shooter the ideas of We've worked hard we deserve to eat out and take nice vacations and retiring early with 4 kids and huge loans don't work well together.

No I didn't. The thought of an early retirement was only a very recent development. Even if early retirement had always been on my mind, I'd still take on the huge loans for the end-result of a much higher earning potential. The amount that I'll be paying toward the students loans is vastly overshadowed by my increased earnings because of the education that I had to take loans out for.

She's only a year away from tenure, and has received consistently excellent student and faculty reviews. We also live in a rural area that struggles to attract professionals. They're already understaffed in their department because they just can't find professors willing to come here. So although it's not a done deal, it's hard to imagine it not working out.

We do have an emergency cash fund that will cover 6 months of expenses (at a lower standard of living than we're at now). I forgot to add that to our assets. And we both have good life insurance. If I croak, my student loans go away and my wife gets a seven figure payout. If she dies, I get less, but commensurate with both of our earnings.

 

[dirtbiker]

It seems like you have a good handle on your finances, so my recommendations are for the most part on par with your plans.

- pay OFF the student debt;

- avoid lifestyle creep;

- get employer match and up retirement savings as salaries increase;

- after payoff of student debt, put (90% of the difference you were paying towards the student loan towards retirement savings);

- WATCH OUT FOR THE FINANCIAL PLANNER. HE/ SHE WOULD LOVE TO GET THEIR HOOKS INTO MANAGING YOUR SAVINGS. IT'S CALLED AUM (ASSETS UNDER MANAGEMENT) FEES. Unless, it is a fee only financial planner, I would avoid this. At your age, the number of years until retirement and your earnings capacity, this could easily have the end result of reducing your retirement nut by seven figures. DON'T GIVE THE FINANCIAL PLANNER MONEY FOR ANYTHING. DON'T BUY A WHOLE LIFE PLAN. IF YOU DO GO, TELL THEM YOU NEED SIX MONTHS BEFORE YOU MAKE ANY DECISIONS AND THEN EDUCATE YOURSELF (see below).

- start reading, and reading and reading. To the extent you don't know, you need to learn about FEES, costs, compounding, asset allocations, etc.

- do you have some funds aside for "emergencies" leaking roof, etc.


Thank you for your service.

I haven't heard the term lifestyle creep before, but it's a good term, and I can see how one (myself) would be prone to that. I will definitely try to avoid it.

I am already maxing my 401K and getting maximum employer match. My wife is maxing hers as well, but her employer doesn't match, since she has a defined benefit pension.

Between what I'm paying out of pocket ($24,000) and taxes on the student loan reimbursement (about $34,000), once I get done with paying off student loans, that will free up nearly $60,000 per year net income. I'm definitely putting that all toward savings and paying off the mortgage. I just don't know exactly how I'm going to earmark that. I really would love to live mortgage-free, but it seems kind of senseless to decrease my high interest investment contributions to pay down a low interest mortgage.

I definitely won't be allowing a financial planner to take over my asset management. I am specifically looking for a fee-only planner to basically meet with once. I just want a professional that can look over things for me, and help with tax planning (which is probably my weakest link in my own personal knowledge).

 

[dirtbiker]

First of all, you are young. Get "The Millionaire Next Door" and ignore your professional status. You have an M.D. behind your name and your wife a Phd after her name. Get passed any influence from others with your degrees and intelligence. All sorts will attempt to sway your lifestyle and spending habits. Outsiders look at your titles/profession and think you're "rich." Ignore that.

All the advice here is great, especially about investing. But it comes down to a couple of basic ideas, get out of debt (that takes awhile) and spend a fraction of what you're earning. Put it away (in saving and investments) and pretend it does not exist.

So true about everyone thinking we're rich because of what we do for a living. Although we earn a very good salary and live comfortably, between saving, paying down student loans, and starting late, we definitely don't feel "rich."

 

[dirtbiker]

sounds like you already have several years of active duty time...?

finish up your Guard obligation...

can your wife teach for PSU online and keep her position?

switch over to active duty (I'd recommend Air Force)...

retire in your early 50's or sooner.

thanks for your service.

LB

I never did active duty per se, but I was deployed three times, which amounted to over 4 years of active duty time.

I have no idea about teaching online, but moving out of the state university system will stop her tenure track and it may be a different retirement system. She's grandfathered into the current pension plan, but new hires now have a blended type 403B/small pension plan that is far inferior to hers. So, we're sticking put for that reason alone.

Active duty pay sucks compared to the civilian world. The defined benefit retirement pay is nice, but the math doesn't work for me at this stage of my life to take such a huge pay cut. I'm actually deploying for four months later this year, and will take a 50% pay cut during the deployment (though with some tax advantages). It's a kick in the balls to have to pack up and leave my family and then take a huge pay cut on top of it... But it is what it is. I knew what I signed up for, and have done it before (but before I at least made more money while deployed), and I do still get the student loan reimbursement which more than makes up for the loss of income during deployments.

 

[dirtbiker]

I agree with this assessment, and I am a newly retired physician. I entered private practice at the same age as the OP with high educational debt, and a non-physician working spouse. You have a reasonable plan, have examined your expenses, but because of so many moving parts at this early stage of your career, you’ve wondered if early retirement is a possibility for you and DW. And the answer is probably, but it’s still too early to tell. For me, every time I joined a group practice and thought I would be with them until I retired, some external major event took place and I was forced to change practices and relocate (and completely uproot my spouse’s employment) and start over, about 3 times. It was only when I reached my early 50’s that I could see that our savings and rate of wealth accumulation and lack of any debt put us on track for early retirement at age 56. It did not require difficult sacrifices. We were able to enjoy a very comfortable lifestyle that would incrementally grow as our debt disappeared, our savings increased, and our incomes grew. But I made sure our savings always outpaced our lifestyle creep. I laughed at Mdlerth’s comment, “In 20 years, he’ll be so FI he can’t stand it,” because it is true in my case.

You actually sound like you’re doing fine without a financial planner because you have a good plan for current and future expenses. It is difficult to say at this point how much you need to have saved for retirement because the common rules of thumb given for the average person (80% of pre-retirement income) are not useful for those who earn a high income well above their actual expenses. It is what you actually spend year to year that is more useful. When I reached 50, I tracked my expenses for the year and again at age 55, and realized we had more than enough for a withdrawal rate of 3%-4% of invested assets. Even if your DW had less than 100% pension due to retiring early, you will know by tracking your spending prior to retiring that you will have enough.

I think your future prospects look very good.

So far I really like my current job. It's the first civilian job I've ever had that I didn't dread going into work every day. I like what I do, and I don't have overbearing management. So far, so long as I'm seeing good patient numbers and am bringing in revenue for them, they leave me alone for the most part. I'd like to stay here. However, competing health systems are already offering me very large bonuses and competitive salaries to jump ship when my initial contract is up. When it comes time to renegotiate my contract, do I ask for bonuses that rival what the competitors are offering me? Is this standard practice? It would be hard to leave large bonuses on the table to stay where I'm at...

I hope that I'll be able to laugh in a few years too about being so FI I can't stand it! lol

Yeah, I guess I will have to wait and see what my expenses actually are and what we project them to be once we get closer to retirement. All my life retirement seemed like a long, far off , distant thing to think about. Now all of a sudden, I'm really realizing that it (hopefully) actually isn't that far away now. Yikes!

Good to see that your hard work paid off for you and your spouse!

 

[HI Bill]

Dirtbiker - if you continue to pay off your debts at the current rate, you should be debt-free (student loans) by age 42.5? As much as I'm sure you're enjoying your salaries, you expressed a desire to do extensive travel once you retire, and possibly retire early. I have a 68-year old doctor friend who can't retire, ever, because of the choices he made. He could easily be worth millions, retired, and travelling now, but he rented apartements that cost more than his housing allowance, ate out extensively, and just never worried about saving. So, I second that White Coat Investor web site recommendation. You have to ask yourself, do I want to be the average well-paid doctor, living with a high standard of living now and massively in debt (read the Millionaire Next Door), or do I want to be able to retire while I'm still healthy, and be able to enjoy travel? I agree with the dissonance statement!

 

[dirtbiker]

Dirtbiker - if you continue to pay off your debts at the current rate, you should be debt-free (student loans) by age 42.5? As much as I'm sure you're enjoying your salaries, you expressed a desire to do extensive travel once you retire, and possibly retire early. I have a 68-year old doctor friend who can't retire, ever, because of the choices he made. He could easily be worth millions, retired, and travelling now, but he rented apartements that cost more than his housing allowance, ate out extensively, and just never worried about saving. So, I second that White Coat Investor web site recommendation. You have to ask yourself, do I want to be the average well-paid doctor, living with a high standard of living now and massively in debt (read the Millionaire Next Door), or do I want to be able to retire while I'm still healthy, and be able to enjoy travel? I agree with the dissonance statement!

That sounds about right to be done paying off my student loans. I'm in a weird position in that I don't want to pay off the student loans too early. The reason being is that if I pay too much out of pocket, I'll pay them off too early, and then I'll miss out on the student loan repayment programs, which is essentially free money. So, I've done a few calculations and determined how much I need to pay out of pocket to pay off the loans in exactly 6 years (which is how long the student loan repayments will be good for). This way, the loans will still be paid off, and I can take the money that I would be using toward paying off the loans, and invest instead.

I'll be buying a copy of this book, which I've seen mentioned several times here.

 

[ivinsfan]

That sounds about right to be done paying off my student loans. I'm in a weird position in that I don't want to pay off the student loans too early. The reason being is that if I pay too much out of pocket, I'll pay them off too early, and then I'll miss out on the student loan repayment programs, which is essentially free money. So, I've done a few calculations and determined how much I need to pay out of pocket to pay off the loans in exactly 6 years (which is how long the student loan repayments will be good for). This way, the loans will still be paid off, and I can take the money that I would be using toward paying off the loans, and invest instead.

I'll be buying a copy of this book, which I've seen mentioned several times here.

So the important thing will be what you do with the loan repayment amount once the loan is gone. You've got a few years to get that figured out and decide if you want some lifestyle improvements or if you want to focus on ER.

 

[pjigar]

Thanks for the quick replies everyone.

The only job around here with a defined benefit plan is with the VA, and that involves a significant pay cut, a soul-sucking government work environment, a 45 minute commute (compared to 15 minute one now), and the defined pension multiplier is a measly 1.1, which isn't enough to justify my pay cut - not even close. So, no DB for me, other than SS and army pension.

I could increase my salary with another job, or more hours at my current job, but honestly I'm not going to. I've worked a lot of long, long hours (100+ hours/week sometimes) over the last few years. Prior to that I was deployed overseas three times with the army for over 3.5 years in total. I've missed way too many holidays, birthdays, etc. from working too much. My wife and I both need me to be home more, not working more.

I am familiar with the White Coat Investor. It's a great resource. Thank you for the link!

Scaling back my lifestyle would definitely help me sock away more toward savings. I know I could scale back, but I honestly feel like I'm living at or below my means... At least compared to other physicians I'm friends with who are all driving new Mercedes and BMWs, etc. living in homes 2-3 times the value of mine. Of course, they could be leaving way above theirs...

There are two areas we could really cut back our spending. We eat out a couple of times per week, plus I usually buy lunch instead of packing at work. This all adds up significantly throughout the month. The other area is vacations. We like to travel. We don't travel extravagantly, but we like to go to a lot of places. I would definitely be willing to cut back on the restaurant budget... But not travel. To me, this is a necessary expense.

My wife is a professor at a state university, which means free tuition to in-state universities for all of our children. And we'll cover room and board, which we'll adjust our budget for at that time. There are 14 to choose from in PA, so that means our children have a choice of 14 to go to, or find scholarships. I know this is off-topic, but expensive private colleges for undergrad are one of the biggest wastes of money you can spend IMO, with a few exceptions. /off topic

Thanks again for all the advice so far!

There is nothing wrong in retiring later in life if the life you are living today is the comfortable one and happy. Having said that, there is no free lunch. You can either eat your cake today and keep working; Or eat a lot of cake later by eating just enough cake today. There are no short cuts to early retirement. Lot of us here are really sold on the time value of money and have opted to cut back spending today for a chance to live large earlier than most people. The choice is yours.

PS: Your savings rate is close to ours so I think you are savings enough. All I am saying is don't get the lifestyle creep on you (especially after your debts are paid off). Track your expenses by categories and see if any category start creeping on you. Some of the biggest things I learned about spending and investing:
* Focus on what matters i.e. cut back on big ticket items if you can e.g. house, car, travel, etc. Don't fuss about small expenses that bring a lot of happiness. I use happiness index when evaluating cost of anything I spend money on!
* Spend on experiences and charity rather than things.
* Invest early and invest regularly on low cost mutual funds.
* Create your asset allocation plan and stick with it through thick and thin. Balance regularly based on the plan.
* Invest money before you can "see" it. i.e. automatic payroll deductions and/or regular monthly contributions for all investments and debts.

 

[dirtbiker]

So the important thing will be what you do with the loan repayment amount once the loan is gone. You've got a few years to get that figured out and decide if you want some lifestyle improvements or if you want to focus on ER.

The current plan is to take the additional $58,000 annual payments to student loans ($24,000 directly paid and the taxes paid on the loan repayments) and put that right into the brokerage account/paying off the mortgage earlier. I just don't know exactly what that ratio will be just yet, but I'm envisioning about 50/50.

If I do the 50/50 route and make no additional lifestyle changes, in six years I'll be increasing the amount we're saving to about $90,000 per year (assuming I'll be adjusting for inflation/max 401K contributions, etc.).

 

[Sunset]

I agree with this assessment, and I am a newly retired physician. I entered private practice at the same age as the OP with high educational debt, and a non-physician working spouse. You have a reasonable plan, have examined your expenses, but because of so many moving parts at this early stage of your career, you’ve wondered if early retirement is a possibility for you and DW. And the answer is probably, but it’s still too early to tell. For me, every time I joined a group practice and thought I would be with them until I retired, some external major event took place and I was forced to change practices and relocate (and completely uproot my spouse’s employment) and start over, about 3 times. It was only when I reached my early 50’s that I could see that our savings and rate of wealth accumulation and lack of any debt put us on track for early retirement at age 56. It did not require difficult sacrifices. We were able to enjoy a very comfortable lifestyle that would incrementally grow as our debt disappeared, our savings increased, and our incomes grew. But I made sure our savings always outpaced our lifestyle creep. I laughed at Mdlerth’s comment, “In 20 years, he’ll be so FI he can’t stand it,” because it is true in my case.

You actually sound like you’re doing fine without a financial planner because you have a good plan for current and future expenses. It is difficult to say at this point how much you need to have saved for retirement because the common rules of thumb given for the average person (80% of pre-retirement income) are not useful for those who earn a high income well above their actual expenses. It is what you actually spend year to year that is more useful. When I reached 50, I tracked my expenses for the year and again at age 55, and realized we had more than enough for a withdrawal rate of 3%-4% of invested assets. Even if your DW had less than 100% pension due to retiring early, you will know by tracking your spending prior to retiring that you will have enough.

I think your future prospects look very good.

+1

I had to stop reading the thread at this point.
OP - you are doing fine. You have a plan and will soon be out of debt. You also need to enjoy life, so continue with the vacations and eating.
Continue to avoid buying new BMW's and other lifestyle creep and you will be fine.

 

[dirtbiker]

There is nothing wrong in retiring later in life if the life you are living today is the comfortable one and happy. Having said that, there is no free lunch. You can either eat your cake today and keep working; Or eat a lot of cake later by eating just enough cake today. There are no short cuts to early retirement. Lot of us here are really sold on the time value of money and have opted to cut back spending today for a chance to live large earlier than most people. The choice is yours.

PS: Your savings rate is close to ours so I think you are savings enough. All I am saying is don't get the lifestyle creep on you (especially after your debts are paid off). Track your expenses by categories and see if any category start creeping on you. Some of the biggest things I learned about spending and investing:
* Focus on what matters i.e. cut back on big ticket items if you can e.g. house, car, travel, etc. Don't fuss about small expenses that bring a lot of happiness. I use happiness index when evaluating cost of anything I spend money on!
* Spend on experiences and charity rather than things.
* Invest early and invest regularly on low cost mutual funds.
* Create your asset allocation plan and stick with it through thick and thin. Balance regularly based on the plan.
* Invest money before you can "see" it. i.e. automatic payroll deductions and/or regular monthly contributions for all investments and debts.

Yeah, the balance of eating my cake now vs. later is what my wife and I are still debating. On one hand, we don't want to live extravagantly and work forever to maintain it. On the other hand, we don't want to live on a shoestring budget now to retire really early. We're trying to strike a balance... It's just where to draw that line that we're still unsure of.

All savings come directly out before we see it currently. If we have money left over at the end of the month, I'll usually try to add that to the brokerage account. Those amounts have been small, but they do technically increase my overall that I have been saving, but not by much.

I don't have any mutual fund investments, but I do have ETFs. My wife has a mutual fund through Gabelli, that I've been trying to get her to change to an S&P 500 ETF, because it's only been returning 7ish % with a 1.3% expense ratio. She's hesitant to because her father originally set it up for her and he swears by it.

 

[pjigar]

Yeah, the balance of eating my cake now vs. later is what my wife and I are still debating. On one hand, we don't want to live extravagantly and work forever to maintain it. On the other hand, we don't want to live on a shoestring budget now to retire really early. We're trying to strike a balance... It's just where to draw that line that we're still unsure of.

All savings come directly out before we see it currently. If we have money left over at the end of the month, I'll usually try to add that to the brokerage account. Those amounts have been small, but they do technically increase my overall that I have been saving, but not by much.

I don't have any mutual fund investments, but I do have ETFs. My wife has a mutual fund through Gabelli, that I've been trying to get her to change to an S&P 500 ETF, because it's only been returning 7ish % with a 1.3% expense ratio. She's hesitant to because her father originally set it up for her and he swears by it.

I hear you. We are also balancing spend vs save to level we prefer. Mutual fund or ETF as long as the expense ratio is low. Low to me is less than 0.2%.

 

[InTheSticks]

My favorite reply thus far! [emoji23]

My every day ride is a WR250R, which serves as my dirt bike, my commuter bike, and my long haul road trip bike. There are compromises for each of those purposes, but it's a great all-arounder, cheap to maintain, and smile-producing!

My older two boys (14 and 16) have a KLX140 and a CRF230. My 14 year old is ready to move up his brother's 230, and my oldest is ready to move up to a 250, probably this year.

And since this is a financial forum, all of the bikes are bought used, and I do all my wrenching on my own to keep costs down.

Very cool. You are making some great memories. WR450F for me.

 

[swakyaby]

OP,

Regarding your upcoming contract renewal, I have sent you a PM (private message).